Cablegate: Embassy Bern

R 191136Z DEC 08




E.O. 12958: N/A

REFS: (A) STATE 127468 (B) UNVIE 576

1. This cable is Embassy Bern's response to ref a regarding
Switzerland's plans to expand nuclear energy and our responses to
the questions in para 8 of ref a as an initial overview of
Switzerland's Civil Nuclear Power program. FCS Bern has already
reported on this topic in the past through the Commerce Market
Research Library and post will continue to report on this topic in
2009 as further information becomes available.

2. Summary:

Switzerland has plans to expand its Civil Nuclear Power Program,
both in terms of reactor construction and spent fuel management
(uranium mining is not in the picture at all and as far as we know
Switzerland does not export fuel supplies).
These plans are based on the Federal Council's revised policy of
2005 to continue to rely on its five existing nuclear reactors and
to replace them over time as needed. The underlying motivation is to
ensure independent capability to meet anticipated power shortages
and energy security. The federal government's role is however
limited largely to approving new plants and ensuring disposal of
nuclear waste; it has little or no role in financing and operating,
as these functions are carried out by so-called private companies,
which to some extent are owned and certainly influenced by the state
(cantonal) governments but nonetheless operate like most commercial
entities. The Swiss nuclear regulatory authority ask, which has been
part of the Swiss Department of energy but will become independent
in 2009, has broad inspection and enforcement powers. Switzerland's
domestic nuclear liability law is being updated under a revised law
of June 2008 and brought into line with international conventions
(notably the Paris convention). The Swiss Manufacturing base is
heavily involved in nuclear-related products or services (but not
mining or reprocessing for export, rather in high-tech components
and services), and there is a balance between locally sourced
components and services and those from outside Switzerland,
especially Germany and the united states. Switzerland should not
experience any problems in terms of the nuclear-trained workforce,
although again it often relies on foreign suppliers. Anticipated
nuclear tenders for new plants are still years away, as they are
subject to governmental approval and probably popular referendum as
well, but tenders are issued by the commercial entities that own and
operate Swiss nuclear facilities, not by the government at federal
or state (cantonal) level. As U.U. suppliers already have a footing
here, it can be presumed that they were successful in the
procurement or tender process. There are numerous sectoral
opportunities for U.S. industry across a broad spectrum of best
prospects. The primary companies domestic and foreign in the
industry are listed below. There are foreign competitors but we are
not aware of any formal or potential agreements at this time, except
in the research area. As a neutral country and staunch supporter of
non-proliferation, Switzerland has no particular political
considerations in terms of cooperating with competing nuclear
supplier states. End summary.

3. The following items a-l respond to questions 1-11 in para 8 of
reftel a:

A. Does Switzerland Plan to Expand its Civil Nuclear Power Program?

Yes, Switzerland's energy policy as revised in 2005 BY THE FEDERAL
COUNCIL calls for new and replacement nuclear power stations.

Switzerland has five operating reactors at four sites (Beznau I and
II, Muehleberg, Leibstadt and Goesgen). With ageing nuclear power
plants which have to be phased out over the next 10-20 years, the

government decided new nuclear power plants (which provide clean,
CO-2 free energy) are needed to prevent a power shortfall after
2020. Of the power produced in Switzerland, 40 percent is generated
from the five nuclear power plants, and the other 60 percent is
mainly generated from hydropower with a small (approximately 5
percent) but growing contribution from renewable energy sources. No
fossil fuels (oil, coal, natural gas) are used in Swiss ELECTRICITY
production. Electricity production represents roughly one-third of
Swiss energy production, which is reliant on imported fossil fuels
to a high degree.

In June 2008, Atel ( submitted an
application to the Federal Office of Energy
( for a general license
to build a new nuclear power station in Niederamt,
Solothurn(district of Goesgen/Olten). In December 2008, the Axpo
Group ( l) and BKW
( eLang=en) established a
joint company to develop plans for two new nuclear power plants to
replace Beznau I/Beznau II and Muehleberg and submitted two
framework applications to sFOE for the licenses.

Hence, permits for three nuclear power plants may (or may not as
SFOE told us) be sufficient to offset post-2020 power shortages.
Atel may join forces with Axpo and BKW and, in any case, the Federal
Council and Parliament must ultimately approve THEM. HENCE, permits
for three nuclear power plants are now under review, although ANY
NEW plants may be challenged as Swiss direct democracy entails
almost certainly a popular referendum as early as 2012 or 2013. A
recent survey revealed that a narrow majority of Swiss people polled
are in favor of nuclear energy for the production of electricity.
For the first time, the survey revealed that in spite of big efforts
to conserve energy, 46% of the public views the construction of
additional nuclear power sites as essential, while 44% of the public
deem additional nuclear power plants superfluous. If a referendum
were held today, the survey concluded that 47% would vote in favor
of the erection of new sites, while 43% would vote against such
plans. This is a major shift from a survey conducted one year ago,
wherein 44% of all the people polled were in favor, and 50% were
against the construction of a new nuclear power plant.

Detailed reports of October and December 2008 on the new plants by
the Commercial Service/US Embassy Bern are available on the Commerce
Market Research Library

The national Cooperative for the Storage of Radioactive Waste
(NAGRA) was established in 1972. It was entrusted with the mandate
of identifying a safe long-term solution for the disposal of all
radioactive waste produced in Switzerland -- a mandate that has not
yet been fulfilled. At present, radioactive waste is being stored
safely in special containers in well-secured halls at an interim
storage site in Wuerenlingen, and at the nuclear plants themselves.
Switzerland's Nuclear Waste Management Concept calls for two
repositories: one for low and intermediate level waste and another
for high level waste. Alpha toxic waste may be stored in either of
the sites. However, this radioactive material needs to be safely
stored for up to a million years, and for this purpose, storage
above ground is not a suitable long-term solution. Today, fully
developed concepts exist for the permanent storage of radioactive
waste in geological formations, but so far it has not been possible
to find a site for a deep geological repository.

With the new legislation that entered into effect in February 2005
(Nuclear Energy Act and Nuclear Energy Ordinance), the Federal
government adopted a new approach: the search for a suitable site

is now to be carried out within the scope of the sectoral planning
procedure. The objective of the Deep Geological Repository Sectoral
Plan is to ensure that, as major projects of national importance;
deep geological repositories can be decided upon and constructed on
the basis of an independent, transparent and fair procedure. This
process is managed by the Swiss Federal Office of Energy (SFOE).

B. Switzerland's Underlying Motivations

Switzerland's underlying motivations include anticipated power
shortages due to the eventual decommissioning of the five existing
nuclear power plants, the fact that Switzerland is committed to
non-fossil fuel energy sources with reliance on nuclear in addition
to hydroelectric as clean, non-CO-2 emitting energy sources, and the
expiration of the import contracts with France (which relate to
energy security). Switzerland's energy posture is based on
independence from foreign sources of electricity, especially when
compared to most of Europe's reliance on Russian and other foreign
sources of fossil fuels.

C. Government's Role in Financing, etc.

The Swiss central (federal) government's role in the financing of
the civil nuclear sector is certainly limited, especially in
comparison with that of other market economy countries, including
the United States. (SFOE noted that Federal funding is limited to
research on waste disposal, safety, etc.) Under the Swiss confederal
system, the cantons have historically played and continue to play a
very large role in energy development (both hydroelectric and
nuclear), and Canton Bern is in fact the majority owner of BKW. The
Cantons generally have ownership and influence on the "private"
utility companies that own and operate the nuclear facilities. These
companies in turn have close relationships with larger European
energy holding companies (e.g., BKW is 21 percent owned by the
Munich energy holding E.ON Energie AG).

D. Switzerland's Nuclear Regulatory Authority

The Federal Nuclear Safety Inspectorate (HSK), which had been
affiliated to the SFOE, is now becoming legally independent as of
January 1, 2009. It inspects and evaluates nuclear safety and
radiation protection at the Swiss nuclear power plants

Acting as the regulatory body of the Swiss Federation, the
Inspectorate assesses and monitors nuclear facilities in
Switzerland. They include its five nuclear power plants, the
plant-based interim storage facilities, the Central Interim Storage
Facility at W|renlingen together with the nuclear facilities at the
Paul Scherrer Institute (PSI) and the two Universities of Basel and
Lausanne, as well as the Institutes of Technology in Lausanne and
Zurich. The Inspectorate assesses the nuclear safety of these
facilities and using a mixture of inspections, regulatory meetings,
examinations and analyses as well as reports from individual plant
licensees, it obtains the required overview of nuclear safety. The
Inspectorate ensures that facilities observe the regulations and
that operations comply with the legislative framework. In addition,
its regulatory remit includes the transport of radioactive materials
and preparations for a deep geological repository for radioactive
waste. The Inspectorate maintains its own emergency organization,
which is an integral part of the national emergency structure and
would be activated if there were a serious incident in a Swiss
nuclear facility.

HSK has 106 employees and expects that number to go up by roughly
10-20 percent in the near future. It currently has 4 open positions

advertised on its website.

E. Switzerland's Nuclear Liability Law Updating

The Swiss Parliament approved the new Federal Nuclear Energy
Liability Act on June 13, 2008, which is based upon the revised
international nuclear liability regime, called the Paris Convention
and the Brussels Supplementary Convention, and provides a compulsory
liability coverage of Euro 1.2 billion (USD 1.6 billion).
Switzerland's revised Federal Nuclear Energy Liability Act can only
be enacted by the Federal Council once the revised Paris Convention
has been ratified. The amendments to the Paris Convention need to
be ratified by two-thirds of the contracting parties e.g. ten
countries, and by all contracting parties for the Brussels
Amendments, e.g. twelve countries. It is anticipated that
Switzerland will ratify both amendments within the first six months
of 2009, but final ratification by the required number of countries
is expected to take 1-2 years.

The Swiss Federal Office of Energy (SFOE) will concurrently work out
the necessary details pertaining to the Nuclear Energy Ordinance.
The Federal Nuclear Energy Liability Act and the Nuclear Energy
Ordinance are slated to go into force in 2010 or thereabouts. The
existing Federal Nuclear Energy Liability Act, entered into effect
on January 1, 1984, applies with a compulsory liability coverage of
Sfr. 1 billion (USD 850 million) until implementation of the revised
Federal Nuclear Energy Liability Act.

F. Swiss Manufacturing Base versus imports

Yes, the Swiss manufacturing base, which is oriented already to
high-precision, high value-added and advanced technology in general,
is particularly well-suited to supplying its own energy companies
products and services both in the nuclear and the hydroelectric
fields. However, as reported by Commercial Service Bern, U.S.
companies like General Electric are very active in supplying and
maintaining Swiss power plants, both nuclear and conventional hydro,
especially in turbine technology, and German and other foreign
companies are also competitive in many subsectors.

It is very likely that many of the components or contracting
services for new plants could be sourced locally, but imports would
certainly be involved. We have not yet developed detailed product
and service information by HS code or other categories nor
determined the relative weight of imported versus domestic sources,
which would vary widely by subsector. Various trade statistics are
readily available; domestic production figures less so.

The market research reports referred to above indicate that the
"best prospects" for U.S. exports can be described as follows:

All of the nuclear power plants in operation today in Switzerland
are based on light water reactor (LWR) technolgy, which includes
both boiling water reactors and pressurized water reactors. General
Electric has made significant inroads on the Swiss market with its
boiling water reactors. GE is in charge of maintenance and overhaul
services at nuclear power plants using GE technology, also providing
(spare) parts, components, and software technology in support of the
upkeep of the plants. Operators of nuclear power plants frequently
turn to U.S. suppliers for projects that require highly skilled
labor and have entire teams on site to carry out these specialized
projects. U.S. technology to encompass generators, reactors, cooling
pumps, parts and components as well as software is highly regarded
among Swiss operators of nuclear power plants. These are the product
sectors that are deemed to have an above-average growth potential.

G. Nuclear-trained Workforce

Switzerland's approach to training is similar to that of Germany,
with a strong emphasis on technical training, on apprenticeships,
etc. In general, the orientation of the labor force is highly
planned during the educational period, and the provision of
engineering specialists, technicians, and construction for the
nuclear workforce would be no exception. The maintenance and
expansion of civil nuclear power, given that Switzerland already has
5 maturing facilities should not pose any significant requirement
for a foreign workforce. As already noted, Switzerland relies on
General Electric and other foreign suppliers for several
requirements in its nuclear and non-nuclear power facilities.
Specifics on programs in place or being developed have not yet been
fully researched, but as indicated above in the material on the HSK
the Universities of Basel and Lausanne (as well as the Institutes of
Technology in Lausanne and Zurich) are involved in nuclear

H. Nuclear-related Tenders/Procurements

CS Switzerland is not aware of any nuclear-related tenders at the
present time. As a general rule, nuclear power plant operators
exercise discretion in inviting bids, and selective, discretionary
tenders are quite common. In general, quality and technical
criteria are more important than price in bid decisions. Foreign
firms may be required to provide a Swiss bank guarantee if they have
no local office or representation. Notices of tenders are published
in the official trade journal Handelsamtsblatt. While there is no
requirement to have a local agent to bid, it is advantageous when
equipment needs training, service or parts. CS Switzerland
endeavors to list tenders on its website and has a direct link to
the CS EU website with a comprehensive listing of tenders.

I. nuclear opportunities for u.s. industry

U.S. suppliers have solidified their position in the Swiss market
over the years. Operators of nuclear power plants frequently turn
to U.S. suppliers for projects that require highly skilled labor and
have entire teams on site to carry out these specialized projects.
U.S. technology to encompass generators, reactors, cooling pumps,
valves, parts and components as well as software technology is
highly regarded among these nuclear power plant operators.
Opportunities for U.S. suppliers lie in the areas of plant design,
equipment for the commercial nuclear electric power industry,
reactor sales, waste management, engineering services, fuel
management services, radioactive waste conditioning/disposal as well
as emergency training. These are the areas that are deemed to have
above-average growth potential. The overall Swiss nuclear power
plant market is highly competitive with an abundance of suppliers
and strong price competition. Procurement decisions are based upon
price and performance. Operational and technical aspects,
maintenance and life-cycle costs and risk are also taken onto
account when contracts are awarded to both domestic and foreign

J. Primary Companies Domestic and Foreign

The U.S. suppliers Westinghouse and GE as well as German supplier
Siemens have made major inroads in the Swiss market, garnering a
substantial share of the overall civil nuclear sector. The
country's first commercial units were Beznau-1 - a Westinghouse
pressurized water reactor ordered by NOK (Nordostschweizerische
Kraftwerke AG), and M|hleberg - a General Electric boiling water
reactor ordered by BKW (Bernische Kraftwerke AG). Following these
three units, a consortium of utilities - Kernkraftwerk Gsgen (KKG),

ordered a large PWR from Siemens KWU for Gsgen and another utility
consortium (KKL) ordered a similar-sized General Electric BWR for
Leibstadt. These companies provide maintenance and overhaul
services, also supplying spare parts, components, and software
technology in support of the upkeep of the plants.
Furthermore, the world-renowned leader in power and automation
technologies ABB is a major player on the Swiss energy market,
providing nuclear waste facilities, LWR fuel, BWR rods, fuel
management services, etc. Colenco Power provides services that
include contractual advice, procurement of nuclear systems,
radioactive waste conditioning/disposal and emergency training. ICT
Inter Control Technology AG is a major player in Switzerland
involved in the installations and equipment for the examination of
spent fuel elements and fuel rods, remote handling systems, and
nuclear robots. Pedi AG provides protection systems for people
involved in the production, supervision, maintenance and emergencies
and remote handling tools.

K. Are there other nuclear supplier countries engaging Switzerland
on its civil nuclear power program?

There is an agreement between Switzerland and the European Atomic
Energy Community (Euratom), which provides for Switzerland's
involvement in EU-sanctioned research programs in the peaceful uses
of nuclear energy. However, there are no agreements whereby Swiss
enterprises are involved in any activities in foreign civil nuclear
power programs.

L. political considerations

It is difficult to assess "political considerations" absent a
concrete context involving one or more particular countries, and
without regard to whether we are viewing Switzerland as a receiver
of nuclear materials and equipment or as a sender. It should be
noted that Switzerland has maintained both strong neutrality and
anti-proliferation stances in its international relations, and also
has laws against the export of items that can be used in warfare.

In general, Switzerland combines its domestic energy policy with
international aspects via its representation in international
organizations, including the International Energy Agency, the
International Atomic Energy Agency, as well as multilateral and
bilateral negotiations on energy policy, non-proliferation of
nuclear weapons, and monitoring nuclear exports.

Switzerland is involved with several bilateral committees dealing
with the safety of nuclear installations, including bilateral
committees with France and Germany. Relating to the U.S. alone,
Switzerland maintains the following agreements: US atomic energy
commission and the Swiss Division of Science and Research to
exchange information in the field of fast reactor physics; US
Department of Energy and the Swiss Federal Institute for Reactor
Research in the area of carbide fuel development; Swiss Federal
Council and the U.S. Government on the peaceful uses of nuclear
energy; Swiss Federal Office of Energy and the US Nuclear Regulatory
Commission on severe accident research, probabilistic risk
assessment research, safety research on deregulation, and related
aging research; Swiss Federal Office of Energy and the US NRC for
the exchange of technical information and cooperation in nuclear
safety matters; and most recently, Swiss Federal Nuclear Safety
Inspectorate and the US NRC for the exchange of technical
information and cooperation in nuclear safety matters.

4. Note: SCO Donald Businger and Senior Commercial Specialist
Sandor Galambos of FCS Bern met on December 12, 2008 with the Swiss
Federal Office of Energy (SFOE) Deputy Director Werner Buehlmann and

Energy Supply Specialist Christian Schaffner to collect input for
this cable.




© Scoop Media

World Headlines


Werewolf: Gordon Campbell On North Korea, Neo-Nazism, And Milo

With a bit of luck the planet won’t be devastated by nuclear war in the next few days. US President Donald Trump will have begun to fixate on some other way to gratify his self-esteem – maybe by invading Venezuela or starting a war with Iran. More>>

Victory Declared: New Stabilisation Funding From NZ As Mosul Is Retaken

New Zealand has congratulated the Iraqi government on the successful liberation of Mosul from ISIS after a long and hard-fought campaign. More>>

Gordon Campbell: On The Current US Moves Against North Korea

If Martians visited early last week, they’d probably be scratching their heads as to why North Korea was being treated as a potential trigger for global conflict... More>>


Gordon Campbell: On The Lessons From Corbyn’s Campaign

Leaving partisan politics aside – and ignoring Jeremy Corbyn’s sensational election campaign for a moment – it has to be said that Britain is now really up shit creek... More>>


Another US Court: Fourth Circuit Rules Muslim Ban Discriminatory

ACLU: Step by step, point by point, the court laid out what has been clear from the start: The president promised to ban Muslims from the United States, and his executive orders are an attempt to do just that. More>>


  • Pacific.Scoop
  • Cafe Pacific
  • PMC